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  • You are dead on Jeff....we are in a media revolution.
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  • Voiceovers:Over the next decade, the evolution of computing and the Internet will produce faster, increasingly intelligent devices. More of our possessions will contain sensors and computers that log our activities, building digital dossiers that augment our memories, help us make decisions and tame information overload.In the next decade as conjured by Forrester Research analyst James McQuivey, all that information will be available instantaneously, anywhere. He also thinks we'll all use this technology just to keep up with everyone else.Craig Mundie, Microsoft Corp.'s chief research and strategy officer, believes we are near a long-wished-for era of computers that respond to speech, gestures and handwriting.The 2000s saw Google become one of the world's most powerful companies because it helped us get a grip on the sprawling content of the Web. What we will need next, however, is a company that doesn't just organize data. Google, or the next Google, will have to synthesize all that information and help us understand what it all means.It used to be we investors focused on how to innvoate in the context of the $50B software industry. Now we are focused on innovating in the $15T GDP economy and
  • MIT, in particular, has been a start-up company factory33,600 companies founded by MIT affiliates; 25,800 are currently activeEmploy 3.3M people and generate $2T in sales250-300 new companies started each year by students and alumniEnduring giants: Campbell Soup, Gillette, Bose, HP, Intel, TI, Genentech, Raytheon, Qualcomm, iRobot, AkamaiMIT Technology Licensing Office (TLO) 2008:282 patents filed, 122 issued20 companies started with VC or $50k of other funding$89.1M in revenues from royalties and equity
  • VC Investments are very, very concetrated in the US. 70% of all VC $ flows into 3 states.Massachusetts has always been a strong #2 to California. But when you look at the numbers on a per capita basis (which is what entrepreneurs care more about – after all, it’s not very relevant how much capital is invested in China, what’s relevant is how concentrated that capital is)…
  • http://www.readwriteweb.com/archives/guide_to_seed_fund_incubators.php
  • New Business creation rate is highest ever in last 14 yearsIdeaWins is Microsofts new competition. $100K + NYC storefront (100K value)
  • Voiceover – Mobile user estimated to overtake desktop users in 2014 (at 1.6 B users)
  • Voiceover: enabled by growth in wireless options (GPS, 3G, Wi-Fi, Bluetooth)

Acg ny presentation   3-30-11 Acg ny presentation 3-30-11 Presentation Transcript

  • ACG – NYThe Future of Digital Media
    Jeff Bussgang
    General Partner
    Flybridge Capital Partners
    March 30, 2011
  • Summary View
    We are in the middle of an unprecedented boom in technology and innovation
    A true “Golden Age” for innovation
    Growth opportunity ahead of us is more rapid and global than ever before
    US is well positioned for the future
    During an innovation age, we have an innovation economy that is the envy of the world
  • Context for My Perspective
    General Partner at Flybridge Capital Partners, early-stage VC firm based in Boston, $560M under management
    • 40+ active portfolio companies, investing out of Fund 3 ($280M)
    Entrepreneur-in-Residence at Harvard Business School
    Former entrepreneur
    • Cofounder/President Upromise (acq’d by SallieMae)
    • VP at Open Market (IPO ‘96)
    Author: Mastering the VC Game
  • Today Are Glory Days for Technology
    We have made unprecedented advances in technology over the last 10 years…
    …and we ain’t seen nothing yet!
    • Social media and networking
    • The “i” generation, training “Net Natives – iPod, iPhone, iPad
    • ‘Cloud computing’
    • Broadband penetration
    • Nanotechnology
    • Synthetic Biology
    • Completion of the Human Genome Mapping project
    • Green consumer
    • Renewable energy
    An explosion in computing power, connectivity and entrepreneurship with an outlook for accelerated growth over the next 10 years
  • Why Is This Happening Now?
    Ingredients for a Vibrant
    Start-Up Ecosystem
    • Intellectual Capital – academia, innovation, diverse industries and ideas
    • Venture Capital
    • Advisors, Angels, Accelerators
    • Successful Companies – to partner, poach and/or sell to
  • Example: MIT – Factory of Innovation
    33,600 companies (300 each year) employ 3.3 million people, generate sales of $2 trillion. 282 patents in 2008
  • Venture Capital: Regional Comparison
    Total VC Investment 2010
    Boston: $2.4B
    New York: $1.3B
    California: $11.1B
    Source: NVCA 2011 Yearbook
  • Why Now? Contextual Forces
    Lean Start-Ups
    Cloud Computing
    Moore’s Law
    Reduced Cost To Experiment
    Opportunity for Angels & VCs
  • Technology startup incubator programs are multiplying
  • More business plan competitions….….with more resources and record submissions
    $20k
    $30k
    $200k
    $225k
    $50K
    $200k
    Source: Robert W. Fairlie using Current Population Survey
  • Large tech company market caps have grown 63% in last 2 years
    Market Cap ($B)
    Dow
    $1.4 T
    Dow grew 11%
    63%
    $ 0.85 T
  • Mid-size tech company market caps have grown 117% in last 2 years
    Market Cap ($B)
    Dow
    $268 B
    Dow grew 11%
    117%
    $ 123 B
  • Tech company balance sheets are strong with tons of cash
    Source: Bloomberg BusinessWeek. images.businessweek.com/mz/.../0503_tech_cash_pile.pdf?...technology
  • Next Wave of Valuable Internet Properties Emerging
  • Bubble-Driven orFundamentals-Driven?
    $8-10B valuation
    IPO Filed
    $10B valuation
    IPO Filed
    $65B valuation
    $15-25B valuation
  • Still huge opportunities for innovation and growthInternet & Mobile consume many eyeballs, little advertising $’s
    Source: Morgan Stanley
  • Mobile internet technology
    Source: Morgan Stanley
  • The “i” generation has arrived
    Source: Top Mobile Internet Trends, Matt Murphy/Mary Meeker – 2/10/11; Apple
  • Ridiculous growth in data traffic….
    Source: Morgan Stanley
  • US now home to less than 40% of the top 50 Most innovative companies
    Global broadband access is growing exponentially
    The middle class is exploding
    No of companies
    Global opportunity: The world is truly flat
    The Expanding World Middle Class
    Million, year-end
    2006
    2010
    +42%
    Personal/mobile
    Shared/premise
    Non-US
    Source: Goldman Sachs: Innovation 2010 BusinessWeek / BCG Survey Results; Telco 2.0 Mobile and Fixed Future Broadband Business Models
  • Cloud computing and the data explosion
    Cloud computing enabling massive growth in volume of digital data
    Worldwide Cloud Services Revenue
    Data Volume (ZB)
    Revenue ($B)
    CAGR
    43%
    CAGR
    28%
    According to Gartner Research:“Cloud Computing will be as influential as E-business”
    Source: Gartner; Morgan Stanley; IDC
  • All The New Jobs Are Created By Startups
    Excluding jobs from new firms, US net employment growth rate is negative
    Without startups, net job creation for the American economy would be negative in all but a handful of years
  • Conclusion
    Unique and special time for entrepreneurship
    Unique and special time for technology and innovation
    Digital Media is being transformed by a host of global contextual forces
    For the foreseeable future, US has huge edge in generating these innovations, which will be the engine that will drive our economy